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Common types of Cryptocurrency Scams and how to Avoid Them

With the rapidly growing interest in cryptocurrencies among significant investors, when more and more people come to this area to take advantage of the enormous profit potential in the digital currency market, the number of criminal activities is also growing. If you have ever been a victim of bitcoin fraud, you probably know that getting money back is the biggest problem since it is impossible to track an anonymous transaction on the blockchain. So, in this article, we will look at some of the main types of cryptocurrency fraud, learn what to watch out for, what to do if you suspect a scam, and how to avoid losing your capital.

The main types of cryptocurrency fraud

Blockchain technology is exceptionally secure, with powerful encryption. Although hacks do happen, the most successful attacks are relatively low-tech, and cryptocurrency investment fraud, such as spoofing and impersonating someone else, is the most common and effective.

Many cryptocurrency scams are based on the use of false data. This may include using a similar username in the hope that you will be mistaken for another person, forging an email address, stealing the identity of a natural person, or creating a completely fake identity.

Fake email. This is one of the forms of malware attack, which consists in providing a fake sender address. This is done by editing the email's metadata by the data of the person, company, or institution that the fraudsters pretend to be. By default, this data is not visible to the recipient of the letter, which makes identifying such crypto scams especially difficult. Gmail and other email service providers are making every effort to detect fake data on the client-side and their identification.

Still, the existing means of protection are far from fail-safe.

You are impersonating someone else's identity as your own. This type of cryptocurrency fraud occurs when a fraudster contacts you, posing as a natural person or organization to whom you can entrust your data, for example, a wallet provider, and tries to force you to grant him access to your funds, for example, to ask you to confirm your account details. At best, this type of fraud can be easily identified because the sender will have a username or email address that has nothing to do with a natural person, and in some cases, are even a random set of letters and numbers.

More sophisticated crypto investment scams involve more concerted efforts at realistic identification. For example, a slightly brighter fraudster posing as Elon Musk and asking for donations in bitcoins may use the name Elon_M. It's hard to be sure who is contacting you, but some channels provide you with ways to verify your identity, for example, Twitter, where you can confirm someone's official account using the "blue checkmark" function. However, it would help if you were especially careful that they don't use a name that is intentionally very similar to the name of a natural person, except for one keystroke, for example, Elon_M instead of Elon-M or using email, for instance, instead of

Next year we will most likely witness an increase in the number of cryptocurrency scams, as cryptocurrencies have become more prevalent in 2021. The growth of popularity will inevitably be accompanied by the development of all forms of fraud with cryptocurrencies. Therefore, to not become a victim of scammers, you need to be alert.

The very nature of blockchain technology contributes to difficulties since its main advantages, such as fast digital transfer of funds pseudonymously, without government intervention or supervision, make it difficult to track funds. There is no name or other identifying data, only alphanumeric strings, which means that how to return money from scammers is highly problematic for bitcoin investors who have been deceived. Therefore, you need to be vigilant and pay attention to the signs of crypto fraud not to be made a fool of.

How to recognize scammers: common signs

As we have already noted above, it is necessary to pay attention to the sender's data of any message in which financial or other personal data is requested. Still, in addition to incorrect usernames and emails, several different signs should tell you that they are trying to deceive you.

One simple rule says that you should be very careful if you are contacted by a company with which you have not previously had any contact. Unwanted contact with someone making you an offer for which you need to provide confidential data or transfer money should arouse your suspicions. Moreover, if you have been sent an incredible promotional offer requiring a deposit, which seems too good to be true, then most likely it is, and you should not send them your funds.

For example, any official sender, a well-known company, as the provider of your wallet, should send you well-written, correctly written, and formatted content. Otherwise, this is a sure sign that you are dealing with one of the many types of crypto fraud.

How to Avoid Cryptocurrency Fraud

Suppose someone contacts you are claiming to be from your trading platform or wallet. In that case, the most straightforward and most reasonable step is to get your service provider directly, through the channels indicated on their website, and ask to confirm that the message is indeed from them.

If you receive a suspicious message, no matter what you do, do not follow the links and do not use the contact information provided in the letter to verify the sender's identity, as a fraudster could have changed it.

In addition, do not hesitate to require a confirmation from the person who asks you to provide your data or capital to be eligible to participate in the promotion. This may include a request to provide information about the offer on the official social channels and the company's website or contact you at a phone number officially listed as belonging to the company they allegedly represent. If they do not want to do any of the above, you should not provide them with your money or personal information.

Although cryptocurrencies offer exciting, lucrative opportunities with more incredible speed, accessibility, and cost-effectiveness than ever before, anonymity and the lack of consistent legislation make them attractive to scammers. By describing some of the most common types of cryptocurrency scams and protection methods, we hope to give you some valuable tools to protect your capital as you move forward on crypto exchanges. However, suppose you are concerned about this new asset class's lack of regulation and wonder how to avoid cryptocurrency fraud with the most excellent efficiency. In that case, the most crucial step you can take is to invest or store your funds only in reliable advanced companies.

And it can be, for example, our Intelfin multiplatform.

Participants of the Intelfin ecosystem enjoy all the advantages of cryptocurrencies and Defi with peace of mind, knowing that the company is a recognized, reliable service provider in the crypto sphere, with the strictest protection measures against hacking and all types of fraud.

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